This study reports for the first time an operation of an outdoor algae assisted Microbial Fuel Cell (MFC). The MFC (10 L) comprised of low-cost materials like rock phosphate blended clayware & low-density polyethylene bags as anodic & cathodic chamber respectively. Algae biomass after lipid extraction at 2 g/l served as electron donor at the anode. Chlorella vulgaris at cathode provided oxygen as electron acceptor and served as lipid source. The MFCs performed well in all aspects namely energy recovery, algae productivity, and cost of operation. The 5% RP-MFCs gave 0.307 kg/m3d algal productivity, 0.09 kg/m3d lipid productivity, and 11.5318 kWh/m3 of net energy recovery (NER). Rock phosphate served as a slow and constant source of phosphorus supporting algae growth. Proteobacteria (45.14%) were the dominant phyla while Alicyliphilus (5.46%) and Dechloromonas (4.74%) were the dominant genera at the anode. The estimated cost of the system was $11.225 only. © 2020 Elsevier Ltd